INVESTIGATION INTO ALLEGATION OF THE UNAUTHORIZED ... · The investigation has confirmed that in...
Transcript of INVESTIGATION INTO ALLEGATION OF THE UNAUTHORIZED ... · The investigation has confirmed that in...
October 1, 2018 IR-01-36-19
THE UNITED STATES VIRGIN ISLANDS
OFFICE OF THE VIRGIN ISLANDS INSPECTOR GENERAL
INVESTIGATION INTO ALLEGATION
OF THE UNAUTHORIZED REGISTRATION
OF MOTOR VEHICLES
ILLEGAL OR WASTEFUL ACTIVITIES SHOULD BE REPORTED TO
THE OFFICE OF THE VIRGIN ISLANDS INSPECTOR GENERAL BY:
Calling: Sending Written Documents to:
Office of the Virgin Islands Inspector General
(340) 774-3388 2315 Kronprindsens Gade # 75
St. Thomas, Virgin Islands 00802
Web Site: E-Mail:
www.viig.org [email protected]
GOVERNMENT OF THE UNITED STATES VIRGIN ISLANDS
OFFICE OF THE V. I. INSPECTOR GENERAL 2315 Kronprindsens Gade #75, Charlotte Amalie, St. Thomas, V. I. 00802-6468
No 1. Commercial Building, Lagoon Street Complex, Frederiksted, St. Croix, V. I. 00840
Tel: (340) 774-3388 STT
STEVEN VAN BEVERHOUDT (340) 778-9012 STX V.I. INSPECTOR GENERAL Fax: (340) 774-6431 STT
(340) 719-8051 STX
October 1, 2018
Honorable Kenneth E. Mapp
Governor of the Virgin Islands
Government House
21-22 Kongens Gade
Charlotte Amalie, Virgin Islands 00802
Honorable Myron D. Jackson
Senate President
32nd
Legislature
Capital Building
Charlotte Amalie, Virgin Islands 00802
Dear Governor Mapp and Senate President Jackson:
The attached report contains the results of our investigation into the allegation that an
employee of the Virgin Islands Bureau of Motor Vehicles (BMV) had prepared and issued
several vehicle registrations without those vehicles having been inspected by an authorized
Motor Vehicle Inspector, in violation of established rules and procedures.
The investigation has confirmed that in fact the vehicles were registered without the
proper inspection as required by the BMV rules and regulations. We also found that there was
the unauthorized use of the inspector’s stamp for the purpose of not only the issuance of new
registrations, but in the clearance of vehicles leaving the territory.
As a result, we have concluded that the Office Manager: (i) violated the BMV’s operating
procedures by processing the vehicle registrations without the proper inspections; (ii)
manipulated the BMV’s computer system to show that the vehicles were properly inspected
when they were not; and, (iii) by the repeated violations of the policies and procedures displayed
a pattern of disregard to the BMV’s operating procedures.
If you require additional information, please call me at 774-3388.
Sincerely,
Steven van Beverhoudt, CFE, CGFM
V. I. Inspector General
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INTRODUCTION
ALLEGATIONS
An investigation was initiated in response to allegations that an employee of the Virgin
Islands Bureau of Motor Vehicles (BMV) had prepared and issued several vehicle registrations
without those vehicles having been inspected by an authorized Motor Vehicle Inspector, in
violation of established rules and procedures.
BACKGROUND
Among its other functions, the BMV is tasked with issuing registrations for personal and
commercial vehicles throughout the territory. According to the BMV’s Standard Operating
Procedures manual, “All vehicles shall be inspected prior to registration by an Inspector and/or
person(s) authorized by the Supervisor with the approval of the Director.” Additionally, it further
states that, “No Inspector or any other employee is to stamp vehicle registrations for anyone
without the vehicle being driven to the Inspection Lane at the Bureau of Motor Vehicles for
proper inspection.”
The standard process for registering a new vehicle coming into the territory at the BMV
entails that a moving permit be acquired from the BMV, and then the vehicle be driven directly
from the port of entry to the BMV. The original title, proof of insurance, and a Road Tax
clearance letter, proving that the associated road tax had been paid, would be submitted to the
BMV. Additionally, if a commercial vehicle was being registered, a valid Business License
would also need to be provided. At the BMV’s inspection lane, the vehicle would be inspected to
verify its vehicle identification number (VIN) against the Title. Once verified, an inspector
stamps and initials the Road Tax clearance letter as verification that the vehicle was inspected,
and when the associated fees are paid, a vehicle registration, title, license plate, and registration
sticker are issued.
The standard process for shipping a vehicle out of the territory entails that an owner
acquires a lien clearance document from the Office of the Lieutenant Governor, indicating that
there are no liens on the vehicle. The owner would also need to verify that no outstanding fines,
regarding citation tickets, are associated with the vehicle. The owner presents the vehicle’s
registration, certificate of title, and lien clearance document at the BMV. Then, a vehicle
clearance form, which verifies that all criteria for shipment have been met, is prepared by the
BMV and the associated fees are paid. The vehicle is then inspected by a BMV inspector, to
verify the vehicle’s VIN and record the odometer reading. Once the vehicle successfully passes
inspection, the inspector stamps and initials the vehicle clearance form, thereby clearing the
vehicle for transport out of the territory. If the vehicle is being shipped out of the territory to a
new owner, then a new title and registration in the new owner’s name are prepared at the BMV.
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In May of 2018, thirteen new vehicles were brought to the island of St. Thomas by a
business entity (Company). A complaint was received by this office, from the Director of the
BMV, alleging that the Office Manager of the BMV had inappropriately processed the
registrations of these vehicles without adhering to the standard operating procedures.
Specifically, it was alleged that these vehicles were issued registrations without being properly
inspected. Accordingly, it was determined that an investigation be launched to validate or refute
these allegations.
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INVESTIGATION
In order to obtain further information pertaining to the allegations, we traveled to the
BMV and made contact with the Director. The Director stated that, in May of 2018, an employee
of the Company (Company Employee), came to the Inspection Lane looking for a particular
inspector (Inspector A), to have documents stamped so that vehicle registrations could be issued
by the BMV’s Office Manager for new company vehicles. The Director indicated that he told the
Company Employee that the associated documents could not be stamped because new vehicles
had to be brought to Inspection Lane to be properly inspected in order to make sure that each
vehicle’s VIN matched with its respective Title.
At the time, Inspector A was not present at the BMV, but another inspector (Inspector B)
was present with the Director. When interviewed, Inspector B confirmed that the Company
Employee made contact with the Director and himself at Inspection Lane and asked for Inspector
A so that documents could be stamped and registrations be issued by the Office Manager.
Inspector B further stated that both he and the Director repeatedly told the Company Employee
that the vehicles had to be brought to Inspection Lane to be properly inspected before any
documents could be stamped. When asked, Inspector B stated that at no time did he ever inspect
new vehicles from the Company, nor did he ever stamp any documents related to those vehicles.
The Director further stated that on or about May 21, 2018, he saw a check attached to
several packets of documents on the desk of the Office Manager. He took possession of the
packets and check, and asked the Supervisor of Cashiers why the check had not been processed
for payment. It was then that he discovered that the packets were for the same new vehicles that
the Company Employee wanted to be stamped. He further stated that there were thirteen packets
of documents, and when he reviewed them, each vehicle’s Road Tax clearance letter had a BMV
inspector’s stamp. However, none were initialed by any inspector as proof of inspection. He
stated that he then went with the documents to the inspectors to inquire which of them inspected
the vehicles. He stated that neither Inspector A nor Inspector B had inspected the vehicles, and
neither one had stamped the Road Tax clearance letters. The Director then initiated an audit of
the BMV internal computer system for each registration. The BMV’s internal computer system,
among other things, logs all registrations issued, identifies the processor or person making the
entry, and lists the inspector who conducted the inspection once entered. The computer system
showed that the Office Manager prepared and issued each of the thirteen registrations and listed
the inspector of each vehicle as Inspector A.
The Director provided us with the document packets for all thirteen vehicles in question.
Each packet contained various documents pertaining to each respective vehicle, including the
Road Tax clearance letter (with the un-initialed stamp), original Title, and registrations.
Additionally, computer print-outs, from the BMV’s internal computer system, displaying the
registration application for each of the thirteen vehicles were provided. We were also provided
with a copy of an invoice, which was signed as being prepared by the Office Manager that listed
the associated registration fees for the thirteen vehicles in question. Our review of these
documents confirmed the Director’s statements, as each vehicle’s registration was listed as being
prepared by the Office Manager. Additionally, each vehicle’s Tax Clearance letter was stamped
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but not initialed, and according to the print-outs of the BMV’s internal computer system,
Inspector A was listed as the inspector of all thirteen vehicles.
Contact was made with Inspector A, who stated that sometime in May, he was in St. John
conducting inspections when he was contacted by the Office Manager and told to go to the
Company, meet with the Company Employee, and inspect several Company vehicles. He stated
that he went to the Company and met with the Company Employee. However, the documents
necessary for him to inspect the vehicles were not present at the time, and he informed the
Company Employee that the vehicles had to be driven to the BMV to be inspected. He
repeatedly denied ever inspecting the vehicles or stamping any of the vehicles’ Road Tax
clearance letters or any other documents relating to the vehicles in question.
The Office Manager was interviewed and was asked in general terms what the
requirements were for registering a new vehicle coming to the territory for the first time. She
explained that the process entails that the vehicle owner, if a business, has to provide a Business
License, proof of insurance, original Title, a moving permit, and Road Tax clearance letter
showing proof that the road tax has been paid. She stated that all vehicles must be inspected to
verify that the VIN on the vehicle matches what is listed on the Title. She further stated that a
Vehicle Inspector would stamp and initial the Road Tax clearance letter as verification that the
vehicle was inspected.
The Office Manager was then asked specifically about the thirteen vehicles belonging to
the Company. She confirmed that she prepared the registrations for all thirteen vehicles and that
she instructed Inspector A to go to the Company to inspect the vehicles. She stated that she was
under the impression that Inspector A had, in fact, inspected the vehicles and that was why she
listed him as the inspector of the vehicles on the BMV’s internal computer system when she
prepared the thirteen registrations. When asked what the BMV inspector’s stamp and initials
meant on the Road Tax clearance letter, she repeated that it confirmed that the vehicles were
appropriately inspected. She affirmed that the stamps should have been initialed by Inspector A.
When asked why she did not, upon discovery that the stamps were not initialed, ask Inspector A
to initial the stamps as required, she had no answer. She repeatedly denied placing the
inspector’s stamp on the Road Tax clearance letters. She identified the Company Employee as
the representative of the Company with whom she dealt with during the registration of the
vehicles in question. When asked, she stated that the physical stamps used by the inspectors are
usually out by the BMV’s inspection lane during inspection hours or on a shelf inside the BMV,
and that potentially anyone has access to them.
When interviewed, the Company Employee stated that he had never gone through the
procedure of registering new vehicles coming to the island and that he was not normally
responsible for registering Company vehicles. He stated that he was informed by a colleague to
contact the Office Manager for directions and guidance on how to proceed with the registrations.
He stated that he went through the process of paying the Road Tax at the Bureau of Internal
Revenue (BIR) for all thirteen vehicles and the obtaining of Road Tax clearance letters at the
BIR. Then, packets containing all of the documents necessary for registration were put together
for each vehicle. The Company Employee acknowledged that an inspector (Inspector A) did
come to the Company, but at the time, only two of the vehicles were present. Additionally, he
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indicated that he did not have possession of any of the documents necessary for the inspections
to be conducted. He stated that the inspector told him that he could not inspect the vehicles
without the appropriate documents and advised that the documents be brought in to the BMV. He
further stated that the inspector instructed him to write the mileage of each vehicle on its
corresponding Road Tax clearance letter.
The Company Employee stated that on the following day, May 9, 2018, he took all
thirteen packets of documents to the BMV to have the Road Tax clearance letters stamped and
the registrations processed. He stated that at the inspection lane, he made contact with another
inspector (Inspector B) and the Director of the BMV. The Director informed him that all vehicles
needed to be driven to the inspection lane of the BMV for proper inspection before any
documents could be stamped and registrations processed. The Company Employee indicated that
he was unsure of what to do and called another employee of the Company, who typically dealt
with registering Company vehicles, for assistance. He stated that he was told, by this individual,
to go to the Office Manager for guidance. He then went directly to the Office Manager, delivered
the packets of documents to her personally, and gave her his phone number with the
understanding that when the registrations were completed, she would call him. She would also
prepare an invoice listing the associated registration fees for all thirteen vehicles, and he would
get a Company check to cover the registrations. Later that day, after being contacted by the
Office Manager, he picked up the registrations, plates, titles, and stickers for the thirteen vehicles
directly from the Office Manager, as well as the invoice. He then took the invoice and submitted
it for processing at the Company. A check was issued by the Company on May 11, 2018 and was
delivered to the Office Manager on the same day by the Company Employee.
Other Instances of Inappropriate Action
Throughout the course of the investigation, it was discovered that the Office Manager had
engaged in additional questionable practices. We received several additional packets of
documents relating to vehicles that were not properly inspected.
Vehicles Coming Into the Territory. We reviewed documents relating to four new vehicles
owned by another business entity (Company B). The registrations for these vehicles were
processed and issued, but the vehicles were not inspected. Each packet of documents related to
each of the four vehicles did not have a business license included nor did they bare the
inspectors’ stamp on the Tax Clearance letters, as required. A BMV processor is listed as
preparing the four registrations, and according to the BMV’s internal computer system, no one
was listed as having inspected any of the four vehicles. An invoice listing the associated
registration fees for the four vehicles for Company B, dated March 15, 2018, was listed as being
prepared and signed by the Office Manager.
Vehicles Shipped Out of the Territory. We also reviewed three groups of document packets
pertaining to vehicles that were leaving the territory. One group of document packets pertained
to seven vehicles that were cleared to be shipped out of the territory. Each packet contained each
respective vehicle’s application for a new certificate of title, proof of insurance, the new owner’s
Business License, vehicle clearance form, original certificate of title, and new registration. The
registrations for all seven vehicles, which were all in the name of the new owner, were listed as
being prepared on September 16, 2015. All seven of the vehicle clearance forms, normally
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prepared and signed by an inspector, were signed and authorized by the Office Manager.
Additionally, the Office Manager’s initials appeared where the inspector’s stamp would be
placed on all seven vehicle clearance forms, which indicates that the vehicles were not inspected
by an authorized inspector.
We reviewed another group of document packets pertaining to ten other vehicles that
were also cleared to be shipped out of the territory. Each document packet contained each
respective vehicle’s application for a new certificate of title, proof of insurance, the new owner’s
Business License, original certificate of title, and new registration. The registrations of all ten
vehicles, which were in the name of the new owner, were listed as being prepared on July 27,
2017, except for one which was listed as being prepared on September 6, 2016. Additionally, all
registrations for these vehicles were initialed by the Office Manager. None of these packets
included vehicle clearance forms, which would normally be stamped and initialed by an
inspector as proof of inspection.
We reviewed another group of document packets pertaining to eight additional vehicles
that were also cleared to be shipped out of the territory. Likewise, each document packet
contained each respective vehicle’s application for a new certificate of title, proof of insurance,
the new owner’s Business License, original certificate of title, and new registration. The
registrations of these eight vehicles, which were in the name of the new owner, were listed as
being prepared on August 17, 2017, except for one which was listed as being prepared on
September 2, 2016. All registrations for these vehicles were initialed by the Office Manager.
There were also no vehicle clearance forms present in any of the document packets related to
these eight vehicles. This indicates that although they were approved for shipment out of the
territory, these vehicles were not inspected.
Conclusion
Based upon the results of the investigation, we conclude that the Office Manager violated
the BMV’s Standard Operating Procedures when she inappropriately processed the registrations
of the thirteen Company vehicles and approved the processing of the registrations for the four
Company B vehicles without them being inspected. Despite her denials of such, the
preponderance of the evidence seems to suggest that the Office Manager placed the inspector’s
stamps on the Road Tax clearance letters of the thirteen vehicles, as the documents related to the
vehicles were solely in her possession until later discovered by the Director.
Furthermore, the Office Manager manipulated the BMV’s internal computer system
when she listed Inspector A as the inspector of all thirteen vehicles. Regardless of whether she
believed that Inspector A had in fact inspected the vehicles or not, the Office Manager had
intimate knowledge of the proper process regarding the inspection and registration of vehicles.
Upon seeing that none of the stamps on the thirteen vehicles’ Road Tax clearance letters were
initialed, even if they were in fact legitimately stamped by an inspector, she should have ceased
processing the registrations and inquired as to why the stamps were not initialed in order to
verify whether the vehicles were actually inspected.
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Our findings regarding the thirteen Company vehicles and the four Company B vehicles
were presented to the Virgin Islands Department of Justice.
Additionally, the investigation revealed that the Office Manager repeatedly circumvented
the BMV’s Standard Operating Procedures regarding the registration and inspection of vehicles
by improperly approving or processing the registrations of vehicles, coming into or leaving the
territory, which had not been properly inspected. Accordingly, we find that the Office Manager’s
actions display a pattern of disregard for the established standard operating procedures.
Recommendations
We recommend that the Director of the BMV:
1) Consider appropriate administrative actions against the Office Manager, to include the
possibility of removing her access to the BMV’s internal computer system and revoking
her authority to process registrations.
2) Issue an agency-wide memorandum reinforcing the Standard Operating Procedures
pertaining to the inspection of vehicles and the processing of registrations.
3) Ensure that the physical stamps used by the inspectors are properly secured to prevent
unauthorized use.
Bureau of Motor Vehicles Response
The Director of the BMV in his September 10, 2018 response indicated agreement with
all of the recommendations made in this report. It was stated that the time period to take
disciplinary action had expired. Standard operating procedures will be reinforced and the
inspection stamps will be secured.
V. I. Inspector General’s Comments
Based on the response submitted, we consider all of the recommendations resolved.
Regarding the Director’s comment that the time period to take disciplinary action had expired, if
the individual is going to maintain the same position and responsibilities, closer oversight of the
activities and responsibilities should be established to ensure that proper procedures are
followed. If similar violations occur, immediate action should be taken.
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APPENDIX
BUREAU OF MOTOR VEHICLES RESPONSE
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